1. Herman Aguinis, University of Colorado at Denver
Performance Management and StrategicPerformance Management and Strategic
Planning: OverviewPlanning: Overview
Definition and Purposes of Strategic Planning
Linking Performance Management to the
Strategic Plan
– Strategic Planning
– Developing Strategic Plans at the Unit Level
– Job Descriptions
– Individual and Team Performance
Building Support

2. Herman Aguinis, University of Colorado at Denver
Strategic Planning: DefinitionStrategic Planning: Definition
• Process
– Describe organization’s destination
– Assess barriers
– Select approaches for moving forward

3. Herman Aguinis, University of Colorado at Denver
Strategic Planning: GoalStrategic Planning: Goal
• Allocate resources
– to provide organization
– with competitive advantage

4. Herman Aguinis, University of Colorado at Denver
Strategic Planning: PurposesStrategic Planning: Purposes
 Help define the organization’s identity
 Help organization prepare for the future
 Enhance ability to adapt to environmental
change
 Provide focus and allow for better
allocation of resources
(continued on next slide)

5. Herman Aguinis, University of Colorado at Denver
Strategic Planning: PurposesStrategic Planning: Purposes
Produce an organizational culture of
cooperation
Allow for the consideration of new options
and opportunities
Provide employees with information to direct
daily activities

6. Herman Aguinis, University of Colorado at Denver
Strategic Planning : OverviewStrategic Planning : Overview
1. Environmental Analysis
2. Mission
3. Vision
4. Goals
5. Strategies

7. Herman Aguinis, University of Colorado at Denver
Environmental AnalysisEnvironmental Analysis
Identifies external and internal trends
• To understand broad industry issues
• To make decisions using “big picture” context

8. Herman Aguinis, University of Colorado at Denver
External trendsExternal trends
• Opportunities:
– environmental characteristics that can help
the organization succeed
• Threats:
– environmental characteristics that can
prevent the organization from being
successful

9. Herman Aguinis, University of Colorado at Denver
External trends –External trends –
Factors to ConsiderFactors to Consider
• Economic
• Political/legal
• Social
• Technological
• Competitors
• Customers
• Suppliers

10. Herman Aguinis, University of Colorado at Denver
Internal trendsInternal trends
• Strengths:
– internal characteristics that the organization
can use for its advantage
• Weaknesses:
– internal characteristics that can hinder the
success of the organization

11. Herman Aguinis, University of Colorado at Denver
Internal trends –Internal trends –
Factors to ConsiderFactors to Consider
• Organizational structure
• Organizational culture
• Politics
• Processes
• Size

12. Herman Aguinis, University of Colorado at Denver
Gap AnalysisGap Analysis
Analyzes:
External environment
(opportunities and threats)
vis-à-vis
Internal environment
(strengths and weaknesses)

13. Herman Aguinis, University of Colorado at Denver
Gap analysis determines:Gap analysis determines:
Opportunity + Strength = Leverage
Opportunity + Weakness = Constraint
Threat + Strength = Vulnerability
Threat + Weakness = Problem

14. Herman Aguinis, University of Colorado at Denver
Strategic Planning for the OrganizationStrategic Planning for the Organization
Environmental and Gap Analyses provide
information for organizations to decide:
Who they are
What they do

15. Herman Aguinis, University of Colorado at Denver
MissionMission
A good mission statement answers:
Why does the organization exist?
What is the scope of the organization’s activities?
Who are the customers served?
What are the products or services offered?

16. Herman Aguinis, University of Colorado at Denver
Mission Statement contains:Mission Statement contains:
A. Information on organization’s
 Basic product/service to be offered
 Primary market/customer groups
 Unique benefits and advantages of
product/services
 Technology to be used
 Concern for survival through growth and
profitability

17. Herman Aguinis, University of Colorado at Denver
Mission StatementMission Statement maymay contain:contain:
B. Information on organization’s values and beliefs
 Managerial philosophy
 Public image sought by organization
 Self-concept of business adopted by
 Employees
 Stockholders

18. Herman Aguinis, University of Colorado at Denver
VisionVision
• Statement of future aspirations
• Focuses attention on what is important
• Provides context for evaluating
– Opportunities
– Threats

19. Herman Aguinis, University of Colorado at Denver
A Good Vision Statement is:A Good Vision Statement is:
Brief
Verifiable
Bound by a Timeline
Current
Focused
Understandable
Inspiring
A stretch

20. Herman Aguinis, University of Colorado at Denver
Purposes for Setting GoalsPurposes for Setting Goals
• Formalize expected achievements
• Provide motivation
• Provide tangible targets
• Provide basis for good decisions
• Provide basis for performance measurement

21. Herman Aguinis, University of Colorado at Denver
StrategiesStrategies
• Create strategies or Game Plans or “How to”
procedures to address issues of:
– Growth
– Survival
– Turnaround
– Stability
– Innovation
– Leadership

22. Herman Aguinis, University of Colorado at Denver
How the HR Function contributes:How the HR Function contributes:
• Communicate knowledge of strategic plan
• Provide knowledge of KSAs needed for
strategy implementation
• Propose reward systems

23. Herman Aguinis, University of Colorado at Denver
Strategic Plans at the Unit LevelStrategic Plans at the Unit Level
• Organization Mission statement, Vision
statement, Goals, and Strategies
Must clearly align with
And be congruent with
• Every Unit Mission statement, Vision
statement, Goals, and Strategies

24. Herman Aguinis, University of Colorado at Denver
Alignment of Strategic Plan withAlignment of Strategic Plan with
PerformancePerformance
Organization’s Strategic Plan
Mission, Vision, Goals, Strategies
Unit’s Strategic Plan
Mission, Vision, Goals,
Strategies
Job Description
Tasks, KSAs
Individual and Team Performance
Results, Behaviors, Developmental Plan
Critical to involve all
levels of management
Critical to involve all employees

25. Herman Aguinis, University of Colorado at Denver
Job DescriptionsJob Descriptions
• Tasks and KSAs are congruent with
Organization and Unit strategic plans
• Activities described support mission and
vision of Organization and Unit

26. Herman Aguinis, University of Colorado at Denver
Individual and Team PerformanceIndividual and Team Performance
Organization and Unit mission, vision, goals lead to
Performance management system, which
Motivates employees
Aligns development plans with organization priorities

27. Herman Aguinis, University of Colorado at Denver
Strategic PlanStrategic Plan 
Choices in PM System DesignChoices in PM System Design
• Criteria (Behavior vs. Results)
• Participation (Low vs. High)
• Temporal Dimension (Short Term vs. Long Term)
• Level of Criteria (Individual vs. Team/Group)
• System Orientation (Developmental vs.
Administrative)
• Rewards (Pay for Performance vs. Tenure/Position)

28. Herman Aguinis, University of Colorado at Denver
Building Support –Building Support –
Answering “What’s In It for Me?”Answering “What’s In It for Me?”
• Top Management:
– Help carry out vision
• All levels:
– Involvement
– Participation
– Understanding